FTSE Russell announced the quarterly review results of its flagship index in February 2022 on February 18, Beijing time.
102 listed companies in A-Shares were included in the index. At the same time, the list of large, medium and small cap stocks also came in and out of each other. It is worth mentioning that China Life Insurance Company Limited(601628) A shares were not reduced to medium cap stocks like many other large cap stocks, but directly removed from the list of FTSE global stock index.
It is understood that FTSE Russell’s stock selection is generally based on professional analysis, on-the-spot investigation and past profitability. Therefore, the operation of companies “favored” by FTSE Russell in the past year is also among the best in the scope of a shares. In the disclosed performance forecast, the “anticipation” rate is as high as 94.5%, and there are not a few companies whose profits have doubled, Some companies increased by more than 10 times.
as the A-share day tends to be specialized and internationalized, recently, international investment banks including Credit Suisse, Wall Street investment bank Bernstein, HSBC, Goldman Sachs and UBS have vigorously sang more A-shares. Funds also continued to pour in. As of press time, foreign investors had accumulated A-share circulation market value of 2.56 trillion yuan through QFII, Shanghai and Shenzhen Stock connect and other channels, with a year-on-year increase of about 63% compared with two years ago. Among them, only northbound funds have steadily returned in the past two months, with a net purchase of more than 100 billion yuan.
102 A-share companies “into the pool”
FTSE Russell announced the quarterly review results in February on February 18 Beijing time. The announcement shows that its flagship index FTSE global stock index series includes 102 Chinese A shares this time, including 26 large cap a shares, 4 medium cap A-Shares and 72 small cap a shares. The above changes will take effect after the closing on March 18 (before the opening on March 21).
Source: FTSE Russell official website
In addition, some previously included A-share targets have been classified and adjusted due to changes in market value. A total of 76 medium cap stocks were transferred to large cap stocks, including 11 Hong Kong stocks such as Meidong automobile, China Merchants port, Shanghai Petrochemical Co., Ltd., China power and Yadi holdings, and 65 A shares (B shares) such as Aecc Aero-Engine Control Co.Ltd(000738) , Autel Intelligent Technology Corp.Ltd(688208) and AVIC capital.
A total of 23 small cap stocks have been adjusted to large cap stocks, including Hong Kong stocks China Suntien Green Energy Corporation Limited(600956) and A-Shares Beijing Easpring Material Technology Co.Ltd(300073) , Beijing United Information Technology Co.Ltd(603613) . The common feature of such companies is that their share prices have sprung up in the past few months, and there is no lack of a trend of doubling or even doubling.
During the fluctuation of stock prices, 15 Hong Kong stocks such as ya life service and 7 US stocks such as mingchuang premium products were adjusted from large cap stocks to medium cap stocks, while China Life Insurance Company Limited(601628) A shares were excluded from large cap stocks. Zhongtong express, Baidu, BiliBili and Wanguo data are still in large cap stocks, but the included objects are adjusted from US stocks to Hong Kong stocks.
It is worth noting that this time, only routine technical adjustments are made to the index constituent stocks, and the changes of the inclusion factors of A-Shares are not involved. Moreover, what is announced this time is only a preliminary list. FTSE Russell will also slightly adjust the above list according to market conditions (such as the adjustment of Shanghai and Shenzhen stock standard), and the final inclusion in the list will be determined before the effective date of the index.
the “pre happy” rate of newly incorporated companies in 2021 reached 94.5%
Statistics show that the goal of FTSE GEIs is to cover more than 99% of the world’s investable assets, including the market value of 49 developed and emerging countries. Its modular design simplifies the precise positioning according to scale, country, region, industry and style, and covers a series of comprehensive indexes. Therefore, the companies included in the index have been highly screened.
It is understood that when FTSE Russell selects stocks, it is generally based on professional analysis, field investigation and past profitability. Only those stocks with high return and stable stock price will be included, so it is easier for mainstream funds to pay attention to these stocks. In addition, the stock also needs to have a certain scale, liquidity, growth and standardization, and the relevant subject matter cannot have the history of active suspension. Therefore, this means that the selected stocks have relatively excellent performance in corporate governance, listing compliance and so on.
The companies that “enter the pool” this time are no exception. With the launch of the quarterly curtain of the annual report, the performance forecast of A-share listed companies is also gradually disclosed. According to statistics, a total of 73 of the 102 companies newly included in the FTSE global stock index have announced performance forecasts, including 69 companies with pre increase and loss recovery, and the “pre happy” rate is as high as 94.5%. There are not a few companies whose profits have doubled, but the profits of many companies such as Xinxiang Chemical Fibre Co.Ltd(000949) , Ningbo Shanshan Co.Ltd(600884) , Hubei Yihua Chemical Industry Co.Ltd(000422) and Asia-Potash International Investment (Guangzhou) Co.Ltd(000893) have increased by more than 10 times, and only a few companies have suffered losses.
From the perspective of stock price rise, the companies favored by FTSE Russell also live up to expectations. The “FTSE Russell” index in the classification continues to rise in the long run. Even after twists and turns, it can quickly recover its lost land and continue to rise. The index has increased by 151% since 2015, far exceeding the Shanghai and Shenzhen index in the same period; Over the past year, it has risen by 11.93%, and also significantly outperformed the Shanghai index (- 4.5%) and the Shenzhen index (- 15.68%).
Foreign capital continues to flow into China’s market {123567}
Recently, foreign media published many articles about China’s stock market, including international investment banks such as Credit Suisse, Wall Street investment bank Bernstein, HSBC, Goldman Sachs and UBS, which said that “it’s time to buy Chinese stocks”.
Bernstein analysts believe that the market expects the growth of new social financing in China, looser monetary policy and more attractive stock valuation compared with the rest of the world. UBS raised its China rating to “overweight” and said it was particularly optimistic about Chinese Internet companies. JPMorgan Chase believes that the CSI 300 index is expected to reach an all-time high in the next 12 months. At present, the index is 4635 points, with an all-time high of 5931 points, which is equivalent to 20% of the rising space of the index in a year.
In fact, the influx of foreign capital is also consistent with its bullish view. Overseas funds continue to increase their positions in A-Shares and become a force that can not be ignored in China’s capital market. According to the data, as of February 17, 2022, the circulation market value of A-Shares held by foreign investors through QFII, Shanghai and Shenzhen Stock connect and other channels totaled 2.56 trillion yuan, a year-on-year increase of about 63% over two years ago, accounting for 3.6% of the circulation of a shares. Among them, only the funds going north have returned steadily in the past two months, with a net purchase of more than 100 billion yuan.
Bank Of China Limited(601988) believes that in 2022, the downward pressure on the global economy is obvious, and the introduction of various policies in China at the beginning of the year further shows its determination to stabilize growth. On this basis, the stability of China’s investment environment will further reduce the risk of foreign investment. Secondly, China’s continuously optimized business environment provides development conditions for foreign capital inflows. The United Nations Conference on Trade and development predicts that it will be difficult for global transnational investment to achieve rapid growth in 2022. Therefore, a good business environment directly determines the flow of foreign capital. China, which adheres to high-quality development, continues to improve all kinds of infrastructure, improve industrial supporting facilities, maintain the market environment and provide policy guarantee. At the same time, it strengthens epidemic prevention and control, becoming a “fertile land” for cultivating foreign investment.
Foreign investment banks: the layout of A-Shares has not changed! The FTSE Russell index is adjusted and newly included in the list of 102 A shares here
